Company Closure (Strike-off)

Strike-off under section 248 of the Companies Act, 2013 removes a company’s name from the Register of Companies. It is the appropriate exit for a company that never commenced business, or that has not carried on business for the two immediately preceding financial years, and that has no liabilities left.

It is not the same as winding up. Winding up is a court or tribunal-supervised process for companies with assets and creditors to deal with. Strike-off is an administrative closure for companies with nothing left to distribute and nobody left to pay.

Since 2023, applications are processed by the Centre for Processing Accelerated Corporate Exit — C-PACE — a centralised unit that replaced the individual Registrar-by-Registrar process. Timelines have improved substantially as a result, but the documentation standard has not relaxed.

Open charges on the register

A company with a registered charge that has never been satisfied cannot be struck off, even where the loan was repaid years ago. The satisfaction has to be filed in Form CHG-4, and that needs a no-dues letter from the lender. Tracking down a bank officer for a loan closed in 2016 is often the longest part of the whole exercise, so it is the first thing we check.

Pending annual filings

The company must be up to date before it can close. That means filing the outstanding AOC-4 and MGT-7 forms with their accumulated additional fees. It feels perverse to file returns for a dormant company purely to close it, but there is no way around it — and the cost only rises with delay.

The accounts must genuinely be nil

Form STK-8 must show no assets and no liabilities, certified by a chartered accountant, and dated within thirty days of the application. Directors’ loans, unpaid statutory dues and a residual bank balance all have to be dealt with first. A statement that is merely optimistic is a false declaration backed by an indemnity bond.

Companies that cannot use this route

Listed companies, companies under investigation or prosecution, companies with pending compounding applications, and companies that have changed their name or shifted their registered office in the previous three months are excluded. Section 8 companies are also outside the strike-off route.

Dormant status is sometimes the better answer

If you may want the company again — you are holding a name, a licence or an old contract — applying for dormant status under section 455 keeps it alive with a much lighter filing burden. Strike-off is irreversible without a Tribunal order, so the decision deserves a moment’s thought.

Applications are processed by C-PACE under the Ministry of Corporate Affairs.

Once Form STK-7 is published the company ceases to exist. Directors should retain the full closure file — resolutions, indemnity bonds, certified accounts and the dissolution notice — because the indemnity given under STK-3 survives dissolution and can be called on if a liability emerges.

Surrender any remaining registrations that were not closed earlier: GST, professional tax, Shops and Establishment, Import Export Code. These do not lapse automatically and can generate notices against a company that no longer exists.

Directors should confirm their DIN status afterwards. If disqualification was triggered before closure, striking off the company does not automatically lift it, and that needs to be addressed separately.